Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Equity

Equity

Common Stock

As of March 31, 2022 and December 31, 2021, the Company had 23,194,566 and 23,146,775 shares, respectively, of $0.01 par value common stock outstanding with 125,000,000 shares authorized at each period end.

Preferred Stock

The Company has outstanding shares of preferred stock and warrants which were issued to institutional accredited investors in a series of private placements during the quarter ended June 30, 2020. The Company issued 2,307,400 shares of 7.25% Series A Fixed-to-Floating Rate Preferred Stock and 2,892,600 shares of 5.00% Series B Fixed-to-Floating Rate Preferred Stock. The shares have a liquidation preference of $25.00 per share. The Company also issued two series of five-year warrants to purchase an aggregate of 6,500,000 shares of the Company's common stock at an exercise price of $10.00 per share. Each series of warrants includes a put option that allows the holder to sell the warrants to the Company at a specified put price on or after July 6, 2023. The Company is using the net proceeds from the private placement to acquire mortgage loans and mortgage-related assets consistent with the Company's investment strategy.

The Company had 2,307,400 shares of Series A preferred stock and 2,892,600 shares of Series B preferred stock outstanding at March 31, 2022 and December 31, 2021. There were 25,000,000 shares, cumulative for all series, authorized as of both March 31, 2022 and December 31, 2021.

Treasury Stock and Stock Repurchase Plan

On February 28, 2020, the Company's Board of Directors approved a stock buyback of up to $25.0 million of its common shares. The amount and timing of any repurchases will depend on a number of factors, including but not limited to the price and availability of the common shares, trading volume and general circumstances and market conditions.

As of March 31, 2022, the Company held 157,776 shares of treasury stock consisting of 108,092 shares received through distributions of the Company's shares previously held by its Manager and 49,684 shares acquired through open market purchases. As of December 31, 2021, the Company held 147,370 shares of treasury stock consisting of 97,686 shares received

through distributions of the Company's shares previously held by its Manager and 49,684 shares acquired through open market purchases, of which 1,220 shares were acquired in the fourth quarter of 2021 under the Company's approved stock buyback plan.

Dividend Reinvestment Plan

The Company sponsors a dividend reinvestment plan through which stockholders may purchase additional shares of the Company’s common stock by reinvesting some or all of the cash dividends received on shares of the Company’s common stock. During the three months ended March 31, 2022 and 2021, 9,739 and 4,228 shares, respectively, were issued under the plan for total proceeds of approximately $0.1 million and $47 thousand, respectively.

At the Market Offering

The Company has entered into an equity distribution agreement under which the Company may sell shares of its common stock having an aggregate offering price of up to $100.0 million from time to time in any method permitted by law deemed to be an “At the Market” offering as defined in Rule 415 under the Securities Act of 1933, as amended, or the Securities Act. During the three months ended March 31, 2022 and 2021, no shares were sold under the At the Market program. The Company intends to use the net proceeds to acquire mortgage loans and mortgage-related assets consistent with its investment strategy.

Accumulated Other Comprehensive Income

The Company recognizes unrealized gains or losses on its investment in debt securities as components of other comprehensive income. Total accumulated other comprehensive (loss)/income on the Company’s balance sheet at March 31, 2022 and December 31, 2021 was as follows ($ in thousands):

Investments in securities:	March 31, 2022		December 31, 2021
Unrealized gains	$	215	$	1,822
Unrealized losses	(8,973)		(802)
Accumulated other comprehensive (loss)/income	$	(8,758)	$	1,020

Non-controlling Interest

At both March 31, 2022 and December 31, 2021, the Company had non-controlling interests attributable to ownership interests for three legal entities.

AS Ajax E II was formed by the Company during 2017 to purchase and hold an investment in a Delaware trust which holds single family residential real estate loans, SBC loans and other real estate assets. AS Ajax E II is 46.9% held by third parties. At both March 31, 2022 and December 31, 2021, the Company owned 53.1% of AS Ajax E II and consolidates the assets, liabilities, revenues and expenses of the entity.

2017-D, a securitization trust, was formed by the Company during 2017. It is 50.0% held by an accredited institutional investor. During the second quarter of 2021, the majority of the loans in 2017-D were sold into 2021-C, with 22 loans remaining in 2017-D substantially reducing the non-controlling interest. At both March 31, 2022 and December 31, 2021, the Company owned 50.0% of 2017-D and consolidates the assets, liabilities, revenues and expenses of the trust.

Great Ajax II REIT was formed by the Company during 2019 to own Great Ajax II Depositor LLC, which acts as the depositor of mortgage loans into securitization trusts and holds subordinated securities issued by such trusts. At both March 31, 2022 and December 31, 2021, Great Ajax II REIT was 0.1% held by third parties and the Company had retained 99.9% of Great Ajax II REIT and consolidates the assets, liabilities, revenues and expenses of the entity.

Securitization trust 2018-C was formed by the Company during 2018 and was 37.0% held by an accredited institutional investor. The non-controlling 37.0% ownership was purchased by the Company during the first quarter of 2021, and the non-controlling interest was derecognized from the Company's balance sheet. At both March 31, 2022 and December 31, 2021, the Company owned 100.0% of 2018-C.

The following table sets forth the effects of changes in the Company's ownership interest due to transfers to or from non-controlling interest ($ in thousands):

	Three months ended March 31,
	2022		2021
Decrease from redemption of 2018-C	$	—	$	(8,306)
Decrease from the distribution of 2017-D	(819)		—
Change in non-controlling interest	$	(819)	$	(8,306)